There is a growing number of companies developing this type of segmentation. We can most notably mention Adsquare, Factual, PlaceIQ, Thinknear, xAd, Locomizer, Verve, 4INFO, Ninthdecimal (formerly JiWire).
The whitepaper explains how location-based audiences are built and show some of the results generated by this targeting.
While this MMA white paper is very interesting, one might however regret that the word "privacy" is not mentioned once in the 14 pages. Marketers should not only look at the accuracy of the data provided by their suppliers, as suggested by the report, but also at how much they comply to high privacy standards.
See below the entire report: